Massachusetts' Public Benefits Fraud: A 97‑Cent Problem

When you hear about fraud on the SNAP and MassHealth programs, the numbers can feel abstract—until you realize that for every $100 swiped, the Commonwealth manages to get back only about $2.70.

That startling figure comes from a recent audit by State Auditor Diana DiZoglio, who uncovered roughly $10.6 million in misused benefits during the second half of fiscal year 2026. The fraud spanned more than 400 cases, with Medicaid (MassHealth) accounting for a little over half of the losses and SNAP the next biggest slice.

“Massachusetts is no different from any other state, except it seems stuck in denial about how deep this problem runs,” said Haywood Talcove, chief executive of LexisNexis Risk Solutions’ Government Group. Talcove, who has spent years tracking government fraud, warned that the state’s recovery rate sits at a paltry 2.7 percent—meaning 97 cents of every stolen dollar stay in the hands of criminals.

Part of the issue, Talcove explained, is staffing. “There are fewer than ten frontline investigators across the entire state,” he noted, adding that the limited human resources are matched by “antiquated” technology that can’t keep up with sophisticated schemes run by organized crime rings.

The audit even highlighted some baffling examples, such as two dental providers billing for services on days their offices were clearly closed—what the auditor called “impossible days.” While these oddities make headlines, they also illustrate a broader systemic weakness: a reliance on self‑reported information that fraudsters can easily manipulate.

Massachusetts officials, however, push back. Olivia James, spokesperson for the Executive Office of Health and Human Services, argued that the auditor’s numbers don’t capture the full breadth of the state’s recovery efforts and that most of the flagged cases—about 95 percent—were already referred to investigators by other agencies.

Still, the money that does get recovered, $285,339 to date, barely scratches the surface of the $10.6 million lost. By the time a fraudulent check clears, Talcove says, the funds are often already laundered, moved across accounts, or even sent abroad, making retrieval practically impossible.

Beyond the immediate loss, the state faces looming federal penalties. New USDA rules stipulate that states with SNAP error rates above 6 percent must foot the bill for the excess. Massachusetts ended fiscal year 2025 with a 12.5 percent error rate, translating to roughly $325 million in overpayments—a figure that, while slightly lower than the previous year’s $364 million, still signals a costly problem.

To turn the tide, Talcove recommends a suite of reforms: hiring more special investigators, overhauling identity‑verification processes, allowing third‑party audits, and moving away from self‑service applications altogether. He also urges the state to share recipient data with the federal government—a step Gov. Maura Healey has resisted, citing fears that immigration authorities might misuse the information.

Until Massachusetts modernizes its fraud‑detection toolkit and boosts its investigative muscle, the bulk of stolen benefits will likely keep rolling into the pockets of sophisticated criminals, leaving taxpayers to shoulder the shortfall.